Transportation Funding Problem Grows
The next state budget could face a $600 million transportation fund deficit.
Q. C’mon, not another column on the problem of paying for statewide highways, bridges and other transportation programs in the 2015-17 state budget. Why climb back on this soapbox?
A. The longer you consider the problem, the bigger it becomes. And, the last column on this issue was months ago; I looked it up. Assembly Speaker Robin Vos and the non-profit Wisconsin Taxpayers Alliance say it may be the most difficult issue in the 2015-17 budget that must be adopted next year.
A. Start with just one figure: $991 million. That’s how much more state government borrowed to maintain transportation programs in the current two-year state budget, which ends June 30.
Current and future generations will be paying down that debt for decades. In the current two-year budget, interest and principal on debt totals $639.1 million; in the next two-year budget, interest and principal payments jump 13.7% – to $726.9 million.
This year, almost 20-cents out of every $1 you pay in transportation fees and taxes will go to service debt. That’s money that can’t maintain, repair or build highways.
Q. Why did our leaders in the Capitol borrow so much?
A. Gov. Scott Walker and Republicans who controlled the Legislature were not willing to consider raising the 30.9-cent per gallon state gas tax or related fees in the year before elections. The last increase in the gas tax was 2006; the last increase in the $75-per-vehicle registration fee was 2008.
The gas tax provides more than half of state transportation revenues.
Q. If the $75 annual registration fee on my car went up to $10, how much would that raise?
A. About $45 million per year.
A. No. Far from it. Estimates of the projected Transportation Fund deficit in the 2015-17 budget range from $224 million to more than $600 million.
Q. Why that huge range in the potential Transportation Fund deficit in 2015-17?
A. It depends what projects you include in 2015-17 spending projections. For example, the state Department of Transportation estimates that only continuing – and not finishing – work on the $1.7-billion Zoo Freeway and Hoan Bridge projects in Milwaukee will cost $957 over the next two years.
By comparison, this year all southeast Wisconsin freeway megaprojects were budgeted at $86 million.
And, legislators along the Madison-to-Illinois Interstate 90/39 corridor want it expanded from four to six lanes – a project estimated to cost $993 million.
Q. I hear candidates in the Nov. 4 elections say one solution is, “Let’s stop raiding the Transportation Fund.” Would that fix the 2015-17 deficit?
A. No. Transportation Fund “raids” have often occurred in the past. But on Nov. 4, Wisconsin voters will be asked to amend the state Constitution to prohibit future raids – a change expected to pass.
And there’s no raid in the current budget. Instead, the reverse is true: The state general fund is providing a one-time subsidy of $107.5 million to the Transportation Fund.
Q. Some candidates who want my vote on Nov. 4 also say they are interested in charging tolls on Wisconsin’s major highways. Is that another possible solution to the funding problem.
A. No, sorry. Under federal law, tolls can now only be charged on new lanes of major highways. Congress would have to change that law and Congress, well, can’t agree on lots of things – including how to pay its share of future transportation costs nationally. FYI: The 18.4-cent per gallon federal gax tax has not been raised since 1993.
Q. Any other funding options to keep transportation spending on track?
A. “Indexing” – annually adjusting the state gas tax for inflation – ended in 2006 and could be restored. A study panel recommended raising the fee to renew our drivers’ licenses. Also suggested was requiring a vehicle owner to report how many miles it was driven every year, so a small mileage-based surtax could be added to the $75 registration fee. Nobody is interested in a miles-traveled surtax, however.
Q. This is depressing. Do you promise to not do another column on this transportation funding mess?
A. How about this compromise: No column on this issue before Jan. 1?